Imports from China decrease, export growth slows in April

China’s imports contracted sharply in April, while exports rose at a slower pace, reinforcing signs of sluggish domestic demand despite the end of Covid-related restrictions and adding pressure to an economy already struggling due to the slowdown in global growth.

Imports from the world’s second largest economy fell by 7.9% in April from a year earlier, extending the 1.4% decline observed in the previous month.

Exports, on the other hand, rose 8.5%, losing steam from the 14.8% increase seen in March, customs data showed on Tuesday.

Economists in a Reuters poll had forecast stagnant imports and an 8.0% rise in exports.

“Earlier this year, it was assumed that imports would easily surpass 2022 levels after reopening, but that’s not the case,” said Xu Tianchen, an economist at the Economist Intelligence Unit.

“While China’s post-Covid recovery has been swift and sharp, it has been largely contained and not felt by the rest of the world,” he added.

Government officials have repeatedly warned of a “serious” and “complicated” external environment in the wake of growing recession risks for many of China’s major trading partners.

The import contraction suggests that the world economy will not be able to rely heavily on China’s domestic growth engine, and as the country re-exports some of its imports, it also reinforces the extent of weakness in some of its major trading partner economies .

A 15.3% drop in semiconductor imports indicates the extent of the contraction in demand in these parts’ re-export market.

Analysts say the strong campaign of global monetary policy tightening over the past 12-18 months and the recent Western banking stress continue to worry China’s and the world’s recovery prospects.

Source: Terra

Rose

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